Monday, December 20, 2010


Supplier Tactics or strategies
Buyer Tactics or strategies
Conceptual planning of Product or Service by Supplier
Features vs competiton / positioning

Price goals / ROI

Channels to sell through

Product life cycle

Financial model with volumes, pricing, service pricing, discounts, allowances

Standard terms


Product or service development
Sales programs
None unless involved in a custom development activity

Sales & service strategy

Fine tuning conceptual positions.

Marketing & Prospecting
Legitimacy - brochures, standard form agreements, standard warranties, published discounts.
Educate internal customer on need to manage communications with suppliers to maintain maximum leverage

Design Assistance
Show them competition

Avoid gatekeepers
Manage Supplier personnel access

Understanding requirements, schedule, need, competition all for use in sale / negotiation.
Manage information shared to maintain leverage and competition
Prequalification by Buyer
Request information which will help with negotiation - e.g. financials

Work on buyer’s psychological needs
Tour location to discover information which will help in negotiation - other customers, load, processes

Seek understanding of requirements (benefits), schedule, need, competition for later use on price / discounts
Talk with none sales people to get non-sanitized information to be used later
Bid / quote / Proposal
Apples, Oranges & Pears
What if / alternatives for total cost analysis

Bait, for later switch
Apples to apples

Price strategy to drive wanted decisions
Seek added information to aid in negotiation
Negotiation preparation
Negotiation plan
Negotiation plan

Goals, minimums
Goals, minimums


Anticipate buyer and be prepared with counters
Anticipate seller and be prepared with counters

Prepare alternatives
Prepare alternatives

Seek input on status & competitive position
Insure competitive position continues (real or perceived)
Legitimacy - Company Sandards
Legitimacy - Company Standards

Benefits & Value
Cost & Margins

Target price

Crunch - Have to do better

Nibble price

List price & standard discounts
Competitive price

Competitive situation requires high discounts and / or allowances

Require cost breakdown & divide & conquer the parts

Use volume or commitment to maintain price
Evalute costs from volume perspective to identify if price breaks are real or artificial

Funny Money
Cost in real dollar terms

Legitimacy - market and other customer
Legitimacy - market, other suppliers and other customers

Remind them of their competition.

Standard terms
Effect of standard terms on total cost & their competitiveness

Why they can’t do it
Why you need it and the impact if we don’t get it

Take it or leave it
Take it or leave it

Offer little & slowly move up
Make high demands and slowly make concessions

Use buyer’s need and schedule against them
Exercise patience / avoid giving them that level of understanding

Use patience
Use seller’s and salesman’s needs and goals against them - e.g. time of order versus goals, quotas, sales numbers etc.

I can’t go further
I can’t go further

Don’t give in or look for the need behind their position
Don't give in or look for need behind their positon

Nibble away at non-price issues
Convert everything to price

Convert everything to price
Nibble away at non-price issues

Use deadlines to drive commitments (price goes up on ....., need your order by ...... to make production, special deal if you commit now because ......
Know the organization well enought to know whether they are real. If not use patience and still insist on getting the sale deal / schedule

Use market changes to drive increases
Use past performance to identify total cost and need for reductions.

Let’s split the difference
Let’s split the difference.

Buy time to strenghten your position
Buy time to strengthen your position

Know your value, competiton and hold firm
Auction - If you can beat this price you have an order.

Check facts, references

Overload them with data
Prioritize demands

Apparent withdrawl - backs away so others can re-address prior concessions
Go around the negotiator to higher level

Hold firm and be prepared to risk losing the business (you want, but don’t need the deal)
Tell them what will happen if they don’t comply
Switch (from Bait)
Hold firm to bid or proposal, insure contract protects against this.

Evaluate to insure you are not getting a diminished value - really equal

Nibble changes
Hold firm or look for price or other concessions

Hold firm or seek price increase
Nibble changes
Take advantage of your position when buyer wants any change:
Seek detail for change and use detail to negotiate

Remind them of the competion or ability to change suppliers

Remind them of future business potential

Take advantage of your position when seller wants any change
Close Out
Get payment ASAP
withhold substantial amounts until all work is completed as leverage to get them to complete.

Seek additional charges for no-problem found situations
Use potential future business to drive performance.

Sell follow-on service contract
Use potential service contract to drive performance

Build performance standards and cost / penalties for non performance in agreements

Get escallation and key contract list and elevate key issues
Seek compensation for claims - e.g. representations, breaches,
Avoid representations and firm commitments unless benefit is substantial and outweighs the potential risk

Look for commitments to future business to avoid claim.
Use potential of future business to have supplier not pursue.

Avoid representations and firm commitments
Seek compensation for claims - e.g. representations, breaches, reliance

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